Saturday, June 16, 2012
Simple Solutions
American businesses are sitting on $2 trillion in cash. Republicans say that if we cut taxes, particularly on what they refer to as "job creators" and slash regulations, businesses will magically be willing to put this capital at risk. The problem is, no amount of tax or regulatory cutting will incentivize a business to hire an additional worker when there is no additional demand for their product. That would be stupid, and American businesses are not stupid. It seems most likely that the result of cutting taxes on "job creators" is that American businesses will be sitting on $3 trillion in cash.
The first step is to identify the problem. The problem right now, at this moment, is lack of demand caused by the consumers in this country simply not having money to spend. They don't have money because: 1) they don't have jobs; 2) they are underemployed; 3) they are being paid less than they used to be paid. In order to address this, several steps should be taken immediately: 1) cut taxes on the middle class; 2) institute real infrastucture spending. Additionally, the tax code should be reformed to accomplish several major policy goals: 1) stop rewarding businesses for moving jobs "offshore;" 2) reward businesses for hiring more employees.
Simple solutions...things all Americans should agree on.
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